Theory posits that managerial holdings of debt (“inside debt”) align managers' incentives with those of outside debtholders. Executive pensions, which consist of ERISA-qualified rank-and-file (RAF) plans and Supplemental Executive Retirement Plans (SERPs), and other deferred compensation...

In this paper, we adapt a continuous-time agency model to incorporate the loss-aversion preferences of agents. To this end, by distinguishing between the gains in capital and income driven by variations in the agent's continuation payoff, we provide a theoretical model which overcomes the...

I analyze both CEO inside debt and firm debt jointly to further investigate the compensation incentives on risky decision-making and the resulting financial policy decisions concerning the debt structure of the firm. I find larger firms with high CEO inside debt tend to diversify, as calculated...

Previous studies argue that takeover targets’ CEOs can use high leverage as a signal for commitment to undertaking value-enhancing projects, thus deterring the takeover attempts since the bankruptcy risk associated with high leverage can serve as an effective governance mechanism. This paper...

Der vorliegende Beitrag untersucht die steuerinduzierten Wirkungen der Außenfinanzierung auf den Unternehmenswert von Immobilien-Kapitalgesellschaften. Im diesem Bereich existieren neben der gewerblichen Immobilien-AG steuerbegünstigte Rechtsformen, wie die vermögensverwaltende Immobilien-AG...

This paper examines the impact of thin capitalization rules that limit the tax deductibility of interest on the capital structure of the foreign affiliates of US multinationals. We construct a new data set on thin capitalization rules in 54 countries for the period 1982-2004. Using confidential...

We investigate whether or not banks play a positive role in the ownership structure of European listed firms. We distinguish between banks and other institutional investors as shareholders and examine empirically the relationship between financial institution ownership and the performance of the...

We develop a dynamic model of banking to assess the effects of liquidity and leverage requirements on banks' insolvency risk. In this model, banks face taxation, flotation costs of securities, and default costs and maximize shareholder value by making their financing, liquid asset holdings, and...

This paper shows that, with pre-set price and capital decisions of firms facing uncertainty and credit rationing, price, mark up and the expected degree of capacity utilization (resp. capital) increases (resp. decreases) with the firm internal net worth

This paper examines the relationships among foreign ownership, capital structure, and firm value in the case of listed firms in Vietnam. Using fixed effect model on data of all listed companies (exclude financial firms and banks) in Hochiminh Stock Exchange during the period of 2008-2011, the...